LCMS Convention Workbook St. Louis, Missouri — 1981, Sheet 386

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CONSTITUTIONAL OPINIONS 377

convention and cannot be used to preclude the action contem-
plated by a District to incorporate separately its District
Church Extension Fund.

The Commission on Constitutional Matters at this time is
not ruling on the meaning and scope of the word “‘policy” as
used in Bylaw 8.61.

July 26, 1980

Supplemental Opinion
re Separate Incorporation
of District Church Extension Funds

(As Applied to the Ohio District)

A

Subsequent to the issuance of its “Opinion re Separate
Incorporation of District Church Extension Funds,” dated
July 26, 1980, the Commission on Constitutional Matters, after
receipt of additional inquiries and a request from the Lutheran
Church Extension Fund—Missouri Synod, agreed at its meet-
ing Oct. 23—24, 1980, to give consideration to additional issues
that had been raised.

The commission then requested briefs or other material
from President J. A. O. Preus or synodical counsel, if the
President deemed it appropriate, setting forth the synodical
position, and also from the Lutheran Church Extension Fund—
Missouri Synod, requesting that that body have its own
counsel review the matter and present briefing on its behalf.
The Ohio District, which had raised the question originally,
was given a similar request. Additionally, the involved parties
were again invited to make personal presentations before the
commission.

Various position papers, letters, resolutions, and statements
were subsequently received. Oral arguments and presentations
were made on Jan. 30, 1981, in a meeting of the Commission on
Constitutional Matters.

B

The following is a review of some of the contentions,
arguments, questions, and documentation received and
reviewed.

Asan attachment toa letter of Jan. 14, 1981, the commission
has now received for consideration a resolution adopted by the
synodical Board for Church Extension in June of 1978 conclud-
ing with a single resolve:

Resolved, That if any District, including but not limited to the Ohio

District, assembled in convention, should approve the proposal to

incorporate the District’s Church Extension Fund, the officers and

the directors of such District are hereby directed to refrain from
establishing such corporation until the Synod’s Board of Directors
and Board of Church Extension have reviewed and approved the

Articles of Incorporation, Bylaws, and proposed policies pursuant to

which the said new corporation would conduct Church Extension

functions within that District. This policy shall be applicable to all

Districts of the Synod, including, but not limited to, the Ohio

District.

In this regard, this document was not previously made
known to the Commission on Constitutional Matters, and it
appears after further research that it apparently was not
considered by the floor committee or by the delegates to the 1979
synodical convention in St. Louis, although it may or may not
have been material to the consideration of 1979 convention
Res. 4-01A and Res. 4-02.

It has also been established that, apparently, this resolution
quoted above was adopted by the synodical Board for Church
Extension in Detroit several days before the June 1978 conven-
tion of the Ohio District but was not furnished to the Ohio
District until some time after its convention.

Further, the Ohio District contends that its decision was
made without any regard to the then proposed Lutheran
Church Extension Fund—Missouri Synod (established as a
separate corporate entity under the Laws of the State of
Missouri on June 15, 1978) and certainly without any deliberate
attempt to circumvent participation in an existing or proposed

und.

Then, as mentioned in the commission’s opinion of July 26,
1980, in what was apparently a “joint” session of the synodical
Board for Church Extension and the newly formed Lutheran
Church Extension Fund—Missouri Synod board of directors, a
“policy” was adopted on March 2—3, 1979, and reaffirmed
June 20—21, 1980 (after the adoption of the 1979 synodical
convention Res. 4-02, permitting Districts not to join the new
fund created by the Synod), prohibiting Districts from estab-
lishing such a separate corporation.

So the commission is now faced with the additional
problem of what is the effect or the relationship, if any, of these
three resolutions.

The Ohio District indicates that it is not certain that it is
bound by the June 1978 resolution of the synodical Board for
Church Extension and suggests the March 2—3, 1979, resolu-
tion of the “joint” “board” and “fund” may be controlling (as
having superseded and replaced the June 1978 “Board” resolu-
tion) and contends, together with its counsel, as hereinafter
discussed, that its action does not violate any “policy” in that
there is a clear distinction between the mechanics of the
proposal of the Ohio District and, for example, the manner in
which the LCMS fund was established as a separate corpora-
tion by the Synod.

The “board” and the “fund” (two separate boards are
involved here although the same persons comprise both
boards) apparently contend that all three actions should be
considered, but further believe the March 2—3, 1979, resolution,
reaffirmed June 20—21, 1980, should be more controlling in
nature.

However, counsel present for the “board” and “fund”
indicates that the action of March 2—3, 1979, and June 20—21,
1980, may have been unnecessary and superfluous, and
indicates that the June 1978 resolution should be considered as
controlling.

Parenthetically, an additional consideration is what
authority, if any, the Lutheran Church Extension Fund—
Missouri Synod may exercise in the area of controlling (estab-
lishing policy) presently existing District boards as contrasted
with “joint” actions of the “fund” and “board” and actions
taken only by the “‘board.” (See Bylaw 8.61.)

During the entire presentation of this matter some parties
have continually requested that other involved parties, includ-
ing the Commission on Constitutional Matters, furnish
“authority” for permitting a certain action to occur, such as the
separate incorporation of a District Church Extension Fund.
Yet no one has presented any clear authority prohibiting the
course of action which the Ohio District has adopted. No
prohibition can adequately be deduced from conflicting policy
statements. It should be noted in this connection that the first
resolved of the Church Extension Fund resolution of March
2—3, 1979, enunciates the policy that Districts “not establisha
separate corporation for... the growth of church extension
activities.”’ This could be interpreted to mean that the Church
Extension Fund opposes the growth of church extension
activities! And certainly no statement prohibiting the proposed
course of action of the Ohio District can be found in the Bylaws
of the Synod.

The Ohio District and its counsel contend that there is a
clear and distinct difference between their proposal and actions
of the Synod in ratifying the creation of the new synodical
“fund.” Among other contentions, the Ohio District indicates
that presently its assets or funds are comingled with the funds
of the Ohio District and that some action needs to be taken
increasing the protection of investors in the fund as well as
making possible less complicated and less costly filing require-
ments with the state Division of Securities—thereby also
providing a more formal operation of the fund and providing
additional protection for the integrity of the fund should there
be any liability claim presented against the District.

It is contended that the Ohio District Church Extension
Fund corporation will not be an independent corporation such
as the newly created Church Extension Fund—Missouri Synod.
Rather, in Ohio, under the “non-profit” corporation law, the
corporation is formed by “members” and in this case the Ohio
District itself ‘‘will be the sole member.” Then the members of
the Board for Mission and Church Extension of the District
will serve as the board of directors of the Church Extension
corporation, but unlike the new synodical ‘“‘fund,” the Ohio